Broadband tax credit cut from stimulus bill

By eSchool News

February 12th, 2009

It appears the tax credit for companies that install new broadband service was cut from the final version of the economic stimulus bill, but the bill still would award more than $6 billion in grants to help build high-speed internet service, mainly in rural areas, reports the New York Times. Though House and Senate lawmakers said they’d reached a final agreement on the bill, no text had been published as of press time. Still, word of the result is spreading around Washington–and it is believed the controversial tax credit, originally proposed by Sen. John D. Rockefeller IV, the West Virginia Democrat, has been eliminated. The initial draft of the tax credit raised eyebrows, because it appeared to favor Verizon Communications. Rockefeller later proposed a new version of the credit that restricted the benefits to companies installing new service in rural or unserved areas. But this change didn’t make it into the final Senate version. As the House didn’t propose any tax credits for broadband service, the entire concept is said to have been dropped in the negotiations between the House and Senate. As for the broadband grant program, the original House bill set aside $6 billion. The Senate initially proposed $9 billion, but that was later cut to $7 billion. According to reports, the compromise would provide between $6.65 billion and $6.8 billion…